California Prepares for New Cannabis Regulations, Anticipates Supply Shortages

California cannabis businesses have only two weeks to bring all of their products up to final state compliance and sell off any stock of untested pot. Even after six months of preparation time, a number of Golden State ganjapreneurs are still entering the regulatory transition unprepared, leading some experts to predict a few weeks of dirt-cheap pot shop fire sales before a summer of dispensary price hikes and product shortages. Any business that does not follow the new rules will be subject to fines and the loss of its license. “We felt like that was a sufficient amount of transition time.”

During the first six months of legal weed sales, California dispensaries relied on a backstock loophole that allowed the sale of untested marijuana procured before January 1st. To avoid pricey testing fees and unstable post-legalization supply chains, pot shops piled countless pounds of pot into storage rooms and vaults. Now, with new testing rules set to turn the page on the entire market, retailers have only two weeks to sell the remainder of their untested weed. “People stocked up, they wanted to not pay the cultivation tax so that product is going to have to be fire sale’d or destroyed this month.”

But once that six-month-old weed is offloaded, refilling shelves could prove to be an even larger obstacle.

“You’re close to 20 million square feet of canopy statewide. And if you have to get that tested at 28 different locations it’s mathematically impossible,” Selan said.

At Steep Hill labs in Berkeley, CRO Tony Daniel says that the company was startled by the lack of regulatory urgency among local growers, distributors, and dispensaries.

If those predictions do come to fruition and retailers are unable to find enough compliant product to supply hordes of Fourth of July shoppers, June’s closeout sales could quickly turn into a pot shop price hike, with retailers trying their hardest to recoup enough profit to keep up with the new regulations.

On the other hand, a number of forward-thinking businesses have already prepared for the summer transition, and say that their packaging and products will pass any state test.

About Merry Jane

is the definitive cannabis resource on culture, news, video, food and style dedicated to expressing a new cannabis mentality. Through exclusive content and relatable perspectives, MERRY JANE highlights the best of cannabis lifestyle while also offering vital, interactive tools to explore the new frontier of products, dispensaries and community.